| |
$1 Million Mortgage Loan to $40 Million Mortgage Loan programs are referred to in the lending industry by the terms "super jumbo mortgage" or even "mega jumbo loan"
Jumbo mortgages are loans which exceed the Fannie Mae and Freddie Mac conforming loan amount limits. This is why Jumbo loans and super jumbo mortgages are often referred to as "non-conforming" jumbo loans or super jumbo mortgages. The jumbo mortgage limits for residential properties are as follows:
2007 Fannie Mae Conforming (non - Jumbo) Loan limits are as follows:
$417,000 Single Family Residence (SFR or 1-unit, most homes fall under this category)
$533,850 Two Family Residence (Duplex or 2-unit)
$645,300 Three Family Residence (Triplex or 3-unit)
$801,950 Four Family Residence (Quadplex or 4-unit)
Properties exceeding the abovementioned conforming loan limits are considered non conforming or Jumbo, super jumbo or mega jumbo for the purposes of the lending industry.
So what does this Jumbo Loan thing mean for $1 Million to $40 Million Mortgage Applicants?
Traditional, conventional lenders can write conforming, non-jumbo loans all day with relative impunity as Fannie Mae and Freddie Mac, large public/private-type institutional investors, will buy these loans so long as they meet very basic underwriting guidelines. So its very easy to get a non-Jumbo loan.
Regular Jumbo loans, from the conforming loan limit for the respective property type to about a $1 Million mortgage loan amount, are also relatively easy to sell toother banks and typical investors, and banks undertake more risk than they would on a conforming loan but not so much that they cannot efficiently underwrite these mortgages.
Where banks and other traditional, conventional mortgage lenders fall apart is on $1 Million to $40 Million mortgages. Because the traditional mortgage loan business requires lenders to be able to find a market to sell their mortgages so they can get back more money to write more loans, these banks and conventional institutions are very hesitant to undertake large loans unless the loan to value ratios are exceptionally low (meaning you borrow 50% or less of the value of the home). By virtue of this reluctance to write $1+ Million Mortgage Loans, these same lenders have very little experience executing these transactions, resulting in even more conservative loan qualifying criteria for Super jumbo mortgages. Add to that the fact that conventional lenders are set up primarily to serve the needs of "conforming" loan customers, which means they lack the personnel to handle complex multi million dollar real estate financing, and you can see why it is so hard to get an average mortgage broker, direct lender or bank to successfully execute a $1MM to $40 Million Mortgage loan.
So Who Handles Multi Million Dollar Mortgage Loan Financing?
$1MM to $1.5 Million Mortgage loan programs have some availability in the broader markets, however $2MM to $40 Million Mortgage loan products are almost exclusively the province of super jumbo mortgage specialists. Often drawn from the investment banking and hedge fund industries, these private firms handle the overwhelming majority of real estate financing for high net worth / high income borrowers. By bypassing the traditional lenders and banks and going straight to the underlying investors on Wall Street and otherwise, these private mortgage bankers and real estate financiers are capable of orchestrating complex transactions with significantly higher loan to value ratios than would otherwise be possible. A few are even able to allow 70%, 80%, 90% and even 100% financing (no money down) on $2MM to $40+ Million Mortgage Loans, by allowing you to use income producing assets which you retain control of in lieu of a down payment.
$1MM to $40 Million Mortgage Loan programs are available to borrowers in the following states:The average interest rates on jumbo mortgages are typically greater than is normal for conforming mortgages, and vary depending on property types and mortgage amount. Loans over a 1 million dollars or super jumbo loans may require more verifications than smaller loan amounts. The higher the loan amount the higher the risk. More reserves may be required as well as higher fico scores. One reason lenders prefer to have a higher down payment from jumbo loan seekers is the higher risk involved. Jumbo home prices can be more subjective and not as easily sold to a mainstream borrower, therefore many lenders may require two appraisals on a jumbo mortgage loan. 1 Mil or 40 Million most lenders want to see liquid assets. Although, in some cases gift funds from a family member are acceptable. Million Dollar Mortgages are available for the high net worth borrowers such as, but not limited to business executives, celebrities, professional sports stars, etc. Many Million Dollar Loan borrowers enjoy the benefits of a Fixed Pay Option program, as they offer a combination of stability and flexibilty on their loan. There are more wealthy people than ever needing million dollar loans. In the United States there are over nine million people who are millionaires, and over one million households with net worth over five million. Million dollar mortgages are termed super jumbo loans or mortgages that are a million dollars or more. |
FOR
ADDITIONAL INFORMATION ABOUT THE SERVICES I PROVIDE,
VISIT MY OTHER WEBSITE AT: FHAandInvestorSpecialist |
SITEMAP
CONTACT MIKE
Other
Websites:
Broker Outpost | Conduit Loans | Sources for Down Payment funds | FHA |
|
|
